Yesterday, Chancellor Rachel Reeves presented the latest government Budget. It included several positive measures, notably the scrapping of the two-child limit, a major step toward tackling child poverty, alongside confirmed changes to Universal Credit rates and increases to both the National Minimum Wage and National Living Wage. Gingerbread welcomes these announcements and the positive impact they will have on single-parent families across the country.

However, with 43% of children in single-parent families living in poverty, these measures are not enough on their own, and we are clear that the government must go further to deliver the reforms these families urgently need. In particular, we were disappointed that the Benefit Cap was not abolished, and we had hoped to see further announcements around childcare and employment.

Social security

A major social security announcement in this Budget was the scrapping of the Two-Child Limit, which currently restricts Universal Credit support to two children in a family. From April 2026, families will receive support for all children, addressing a significant inequality in the system and removing the appalling requirement on mothers to prove they were raped to qualify for exemption. With over half of all households affected by the Two-Child Limit being single-parent families, Gingerbread has long called for this reform.

Alongside the removal of the limit, the child element of Universal Credit will be increased. By the government’s own estimates, 560,000 families will see an increase in Universal Credit benefits in 2029-30, reducing rates of child poverty by 450,000 by 2029-30.

However, this cannot be the end of action and investment in the social security system. Despite yesterday’s announcement, thousands of families in the deepest poverty will continue to have their income restricted by the Benefit Cap, which limits the amount of social security a household can receive. Almost 70% of households affected by the cap are single parents and over half of these have a youngest child under five years old. To have the greatest impact on child poverty, the government must also scrap this policy.

Employment and childcare

Gingerbread welcomes the announced changes to both the National Minimum Wage and the National Living Wage, which are set to increase by 8.5% and 4.1%, respectively, from April 2026. These changes will benefit many single-parent families, who are more likely to be employed in low-paid and part-time roles as they must often balance work and childcare responsibilities on their own. However, we would have liked to see measures announced to incentivise employers to create more flexible roles to improve access to high-quality employment for single parents.

It was also disappointing that the Budget did not go further to strengthen and expand childcare support. While the government’s current offer of 30 hours of funded childcare per week helps single parents access employment, it remains unavailable to those in training or education.

Gingerbread often hears from single parents who want to retrain to secure better employment and improve the balance of their work and parenting responsibilities, and we are calling on the government to extend eligibility for its funded hours offer to parents in education and training. This will remove barriers for single parents seeking to enter, re-enter or change work.

Other Announcements

We were pleased to see the announcement of changes to energy bills that will deliver savings for many households, alongside the reiteration of several positive, previously announced measures, including the expansion of free breakfast clubs and the expansion of eligibility for free school meals to all children in England with a parent receiving Universal Credit.

Next Steps

Whilst yesterday’s news was a welcome step forward, it’s only the beginning of the story. Gingerbread will continue to campaign for this government to deliver the lasting and meaningful change that single-parent families need. The government is also expected to publish its Child Poverty Strategy in the coming weeks. Within this, it must commit to scrapping the Benefit Cap, and we hope to see further measures announced to improve support for single-parent families.

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